2024-04-19 13:49:25
Motor1 assembles around 1,000 motorcycles per month at its plant, located in Yaruquí, Quito. The agreement with China puts motorcycle assembly at risk.
One hour from the city of Quito, in the rural parish of Yaruquí, the Unnomotors motorcycle assembly plant is located on a 10-hectare plot of land. Every eight minutes, a motorcycle is assembled at this location.
Unnomotors is the importing and assembly company of Grupo 1, known as Motor1. 38 motorcycle models are assembled at its plant: 29 of its Motor1 brand and nine of Sukida. The parts and pieces that make up the motorcycle, including the engine, arrive in wooden boxes from the city of Chongqing, in China, where its models are designed.
In total there are about 800 pieces imported from China. Other parts, such as seats, steering wheels or the exhaust system, are manufactured in Ecuador. To benefit from the tariff exemption on the import of CKD (parts and pieces for assembly), motorcycles assembled in the country must comply with 18% local components.
Assembly process
Every time they launch a new model on the market, Unnomotors imports a first batch of completely assembled motorcycles (CBU), as a test. Then, it begins to import in CKD to assemble in Ecuador, explains Sebastián Mendizábal, commercial manager.
The plant’s assembly line is made up of 10 stations. In each of them, about two workers are in charge of fitting one piece with another. The first step in assembly is to join the chassis, the central part of the motorcycle, with the engine.
And once this is achieved, the vehicle can be registered with the Internal Revenue Service (SRI) with an identification number, known as a VIN. The process continues with the integration of the other pieces.
After the motorcycle is assembled, it must go through the quality control area, where it is confirmed if any correction is necessary. After that, it is considered a finished product.
In total, the factory assembles between 45 and 60 motorcycles per day, which represents around 1,000 motorcycles per month, Mendizábal details.
Motorcycle portfolio
In addition to Unnomotors, the companies Unnocycles, in charge of marketing, and Unnoparts, in retail, are part of Grupo1.
The Motor1 and Sukida brands are sold in the Master Moto chain, which has 40 stores in the country; in the eight Motor1 stores, and through another 400 distributors. Their motorcycle models are grouped into several segments or types of motorcycles:
Their motorcycle models are grouped into several segments or types of motorcycles:
Utilitarian: for working in the city, small in size and low fuel consumption; The engine displacement is between 150 and 250 cubic centimeters (cc). Prices range between USD 1,200 and 1,800.
Double purpose: to move on different types of roads, both asphalt and stones; The displacement is between 150 and 250 cc, and they cost between USD 1,800 and 2,500. In this group is Motor1’s most successful motorcycle, the Trail, which has four versions.
Sports: These are models with a sportier design, like those from Motor1’s ‘Black series’ line. The displacement is between 200 and 250 cc. Prices range from USD 1,800 to 3,000.
Premium: They are motorcycles with more technology, with a displacement of up to 400 cc. Prices are between USD 1,800 and 3,000.
Another of the group’s business lines is the motorcycle spare parts and accessories division, through which they market nearly 800 products, such as helmets, tires, batteries and lubricants.
Impact of the agreement with China
Starting May 1, when the trade agreement between Ecuador and China comes into force, imported, fully assembled motorcycles from that market will begin to pay fewer tariffs in Ecuador and, with this, will drop in price. Currently, Chinese motorcycles pay a 30% tariff. But, in a period of 15 or 20 years, depending on the cylinder capacity, they will reach 0%.
Motorcycles imported in CKD (parts and pieces) do not pay tariffs, as an incentive to the national assembly industry.
However, it is a requirement that they also include local parts, which increases the cost. But, given the reduction in tariffs and prices that Chinese motorcycles will have, Motor1’s commercial manager, Sebastián Mendizábal, believes that motorcycle assembly will no longer be a profitable business in Ecuador.
«It is not going to be convenient for us to assemble. “The Government forces us to stop doing it.” Sebastián Mendizábal, commercial manager of Moto1
In fact, due to the progress that the tariff reduction will have, it is estimated that in a period of five years they will stop assembling and will begin to market only assembled motorcycles in China. A change in the business that, without a doubt, will imply a reduction in its jobs.
Currently, around 100 people work in the importation, assembly and marketing of motorcycles. In total, with its retail stores, the group employs around 400 people.
20 new motorcycle models
Group 1 belongs to the Vázquez Group, founded in Cuenca in 1943, which operates in different lines of business: automotive, retail, insurance, financial, jewelry, household appliances, construction, real estate and manufacturing.
Their foray into the motorcycle market occurred in 2016, when they purchased the Motor1 and Sukida brands from the Betancourt Group (owners of Pintulac), which began assembling motorcycles in the late 90s.
Motor1 ranks seventh among the best-selling motorcycle brands in the country, according to the Association of Automotive Companies of Ecuador (Aeade). In position one is the Chinese brand Shineray, which also assembles part of its portfolio in Ecuador.
In 2023, the business group sold nearly 11,000 motorcycles between its two brands, achieving a growth of 10% in volume and 5% in billing, says Mendizábal.
At the end of last year, it launched 20 new models and renewed the image of its brands, which required an investment of USD 2 million. The results of this investment are expected to be seen in 2024, a year in which they expect to grow at least 15% in billing, says the commercial manager.
By: PRIMICIAS